New Zealand has a long and fascinating history with gas. Finding the Kapuni and 'giant' Maui fields provided the impetus to develop an extensive gas production and distribution network under the auspicious of 'Think Big'. Today gas provides around 20% of our primary energy supply, emits half as much CO2 as coal, and given it's abundance, makes it an affordable and realistic replacement for coal in power generation.
Gas accounts for almost half the energy used for food processing and a third of the energy used in wood processing, which collectively represent most of New Zealand’s exports.
of our primary energy supply
New Zealand households instant heat, energy & continuous hot water supply.
businesses such as restaurants, hotels, greenhouses & hospitals
of our electricity generation (2nd only to hydro)
All the natural gas that is discovered and produced in New Zealand is consumed locally - either domestically or by commercial users. That said, around a third of our natural gas produced each year is converted to methanol, an exportable industrial alcohol.
Natural gas has traditionally been costly to transport, either through expensive large scale pipelines or liquefied by expensive plants. Only recently have global markets for natural gas begun to open up, and over the next 50 years inter-regional transport of gas is expected to grow significantly. For now the relatively low price of gas, and the high cost of transport, preclude it from being valued as an export commodity from New Zealand.
It is located in the Tasman Sea, 35 km off the coast of Taranaki and to the southwest of New Plymouth. It covers an area of 157 square kilometres and is located in 110 metres of water
"The biggest news of the recalculation involves one of the oldest gas producers. When the offshore Maui field was discovered in 1969 and developed 10 years later, it was forecast it would be exhausted in 30 years. But now its remaining proved reserves have been doubled to 133 PJ and its 2P reserves more than doubled to 466 PJ."
One of the economic advantages for natural gas in New Zealand is that it's locally sourced. That brings an element of security of supply to our energy. Many nations are net importers of energy, and that leaves them exposed to an international supply chain that can be buffeted by international events - like political instability and conflict. New Zealand’s energy self-sufficiency in 2018 was 75 percent, with oil contributing 34 percent of all primary energy supply, and gas a further 20 percent.
Methanex New Zealand is the nation’s only methanol manufacturer, and operates two facilities in Taranaki at Motunui and the Waitara Valley. Methanex plays an important role by providing oil and gas producers with a local market for their indigenous gas, and as such contributes to the overall investment attractiveness of the New Zealand market. Taranaki’s methanol plants had their beginnings in the late 1970’s and early 1980’s when the government, under Prime Minister Robert Muldoon, initiated Think Big.
In the face of a global oil crisis, the substantial natural gas reserves off the Taranaki coast were seen as a means of making New Zealand more self-sufficient in transport fuels. Think Big projects included the development of a methanol plant at Waitara and a synthetic–petrol plant at Motunui. During construction over 2000 workers were employed, and production peaks saw more than 400 employees on site. However, making synthetic petrol proved uneconomic when the crude oil price dropped, and Motunui was subsequently sold to Fletcher Challenge who later on-sold it to Canadian headquartered Methanex. The company constructed distillation units at the facility, shifting output from synthetic petrol to methanol production.
Redetermination of the Maui gas reserves in 2003 curtailed gas supplies, which saw the closure of the Motunui plant in 2004 and remaining operations focusing on the Waitara Valley plant. In 2008, a three-year supply contract was secured which prompted the refurbishment and recommissioning of one of the two production units at Motunui but led to the mothballing of Waitara Valley. In 2010, on the back of buoyant global methanol demand, Methanex signalled a desire to refurbish Motunui-1 to minimise disruption caused by code-of-compliance inspections. Recent successful gas developments, coupled with a supportive government approach, have given Methanex new confidence in their New Zealand operations. They now have sufficient gas supply to operate the Motunui plant at full capacity, reopened the Waitara Valley plant in 2013, and have a positive future outlook based on methanol’s potential in a carbon-constrained world.